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'Feeding Frenzy' May Be a Picture of Restitution

Scam victims hope money from Wyland artwork and royalties will help repay a $20-million loss.

August 19, 2003|Christine Hanley | Times Staff Writer

Jerry Womack wanted his favorite artist to paint him a picture of humpback whales scouring for food along the Alaskan coast. And Wyland, best known for his paintings of creatures that live under the sea and giant murals of whales, was intrigued enough to take on the task.

Five years later, "Feeding Frenzy" hangs like a bad metaphor in a Las Vegas art gallery.

It turns out Womack lied to Wyland about who he was, stiffed him for half the price of the painting and finally was sent to prison for swindling about $20 million from nearly 400 people who fell for his slick stock-trading formula, according to federal prosecutors.

With most of their money gone, Womack's victims have now pinned their dimming hopes on "Feeding Frenzy." They plan to divvy up the profits from the painting and then go after the royalties earned from the sales of copies of the original.

Wyland, suddenly immersed in a con artist's world, would prefer to see the proceeds go to one of his pet charities.

"I would say it's pretty ironic that I titled it 'Feeding Frenzy,' " Wyland said during an interview at the Laguna Beach gallery where he lives.

The story, as detailed in criminal and civil court records and in interviews with participants in the dispute, began in 1997 inside a Chatsworth machine shop where Womack was toiling as a repairman and dabbling in the stock market. He developed a scheme for making a killing on Wall Street he called the Womack Dow Principle, said Assistant U.S. Atty. Christine M. Adams, who led the successful prosecution this year. Authorities later called it a classic Ponzi, or pyramid, scheme in which a few profited off the investments of hundreds of others.

For the next two years, Womack was like a revival preacher pitching miracle cures as he wowed wide-eyed listeners from California to Florida with promises of wealth if they put their faith -- and their money -- in his formula. He held seminars across the country, using hotel ballrooms, yacht clubs, churches and private homes as staging grounds.

Federal prosecutors said he told the faithful that he had traders working the floor of the New York Stock Exchange, buying low and selling high on their behalf. He played up his blue-collar background, convincing would-be investors they too could go from rags to riches. He was charming. He was confident. And eventually he made believers out of 380 men and women who invested anywhere from the minimum $2,200 to upward of $100,000 in his fund, the Iris Limited Partnership, court records show.

"Jerry Womack was magic," said Carol Oakley, 70, recalling how her husband forked over the bulk of his retirement fund to Womack. "He said, 'Folks, this is real. We're going to get rich together.' And we, like a bunch of guppies, took it all in."

The truth was that Womack was a con man, prosecutors say. He used the investment money to buy diamonds, gold and Rolex watches, Armani suits, homes and other properties in several states. He drove luxury cars, hired bodyguards. He got a face-lift and a tummy tuck.

And he commissioned a painting. Wyland, who uses only his last name, recalls meeting Womack when the artist made an appearance at one of his galleries in Las Vegas. Womack, he recalls, was dressed sharply and accompanied by one of his sons. But what stood out the most was Womack's idea, because Wyland had never before painted foraging humpback whales. They agreed on a price of $128,000 for a 36-inch-by-48-inch canvas. Half was paid upfront with a check cut from the Iris partnership. The balance was due upon delivery.

After making the deal, Wyland invited his new client to join him and some business partners at the Dive, Steven Spielberg's marine-themed Las Vegas restaurant. Over dinner, Womack passed himself off as a high-rolling Wall Street broker and showered Wyland with praise, telling him he planned on becoming a top collector of his art.

"He was a big talker. He said, 'I'm rich. I want to buy a lot of your art,' " Wyland recalled.

Wyland spent a year finishing the painting, but toward the end he got a sinking feeling about the deal. Womack seemed to be dodging phone calls, and Wyland couldn't get a straight answer about when Womack was going to pay the balance.

Womack's investors were having the same bad luck. When an angry group of them confronted him at his Las Vegas home, he promised them he was on his way to New York to work out some issues that were keeping their money tied up. Prosecutors say that's when he disappeared.

When the effort to recover Womack's assets began after his arrest in October 1999, the pickings were slim. He had actually doled out $1 million to $2 million to some of the earliest investors to keep his scheme going, and most of what was left had either been spent or lost in divorce settlements with two women he had married briefly during this time, according to court documents.

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